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par KAUFMAN & BROAD (EPA:KOF)

Kaufman & Broad SA: ANNUAL RESULTS 2023

Kaufman & Broad SA
Kaufman & Broad SA: ANNUAL RESULTS 2023

31-Jan-2024 / 18:38 CET/CEST
Dissemination of a French Regulatory News, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.


  

S Press release

  Press Release

 Paris, 31 January 2024

 

Annual Results 2023

 

 

  • Attributable net income up 22.7%
  • Very solid financial structure:
  • Positive net cash(b) of €180.5M
  •  Financial capacity of €600.0M
    • Proposed dividend for 2023 of €2.40 per share

 

  • Main elements of commercial activity (2023 vs. 2022)

 

  • Total orders:

1,113.2 vs €1,481.7M  incl. VAT

Of which housing: 1,079.4 vs €1,433.8M incl. VAT

Of which Commercial Property: 33.7 vs €47.9M incl. VAT

  • Housing take up period:

4.8 vs. 4.3 months (12 months)

 

  • Main financial items (2023 vs. 2022 unless otherwise specified)

 

  • Revenue:

1,409.1 vs. €1,314.9M

Of which housing: 957.8 vs. €1152.5M

  • Gross margin: 257.2 vs. €228.2M
  • EBIT margin(c):  7.8 % vs. 7.5%
  • COI EBIT: 109.3 vs. €98.2M
  • Attributable net income

60.2 vs. €49.0M

  • Net cash (b) : €180.5M vs. € (67.8 ) M at 30 Nov 2022
  • Financial capacity: €600.0M vs. €351.0M at Nov 30, 2022

 

  • Main development indicators (end of Nov. 2023 vs. end of Nov. 2022)

 

  • Total backlog: 2,676, 0 vs €3,393.3M

 Of which housing: 2,053.4 vs. €2,362.8M

  • Housing property portfolio: 

34,069 vs. 34,009 units at the end of 2022

Kaufman & Broad SA today announces its 2023 results (from December 1st to November 30th, 2023). Nordine Hachemi, Chairman and Chief Executive Officer of Kaufman & Broad, said:

 

“Kaufman & Broad's 2023 results are in line with guidance. They demonstrate the strength of its business model and its ability to generate cash.

 

Over the year, housing orders fell by 14.2% in volume terms, compared with an estimated decline of around 35 %(d) for all market orders. These stood at nearly 60,000(d ) in 2023, the same level as in 1995.

 

In this environment, Kaufman & Broad continued to apply a rigorous policy of rapid adjustment to market conditions. A high level of requirement was maintained in terms of presales rate.

 

This strategy resulted in a 4.8 month run off period for our programs, compared to nearly 20 months for the market.

 

In addition, the group still relies on a solid land reserve and an overall backlog of 2.7 billion euros representing approximately 2 years of activity.

 

The Corporate Real Estate business saw continued work on Austerlitz's A7/A8 operation in accordance with schedule. In addition, a building permit has been filed for an operation of over 30,000 m2 of office space in Marseille, EDFD's future regional headquarters.

 

The crisis in the sector is not solely due to rising interest rates. The continuous decline in the allocation of building permits since 2018 has led to an increase in land costs that have not been absorbed to date. Added to this were regulatory inflation and excessive taxation. As a result, housing production is down significantly, even as demographic and sociological factors continue to fuel sustained and unmet demand. Rebalancing these various factors should lead to a market adjustment in the coming half years.

 

The financial structure remains extremely strong. For the full year, operating cash flow amounted to €374.8 million(a ). At the end of November 2023, positive net cash(b) amounted to €180.5M and financial capacity to €600.0M. Last September, Fitch confirmed the Investment Grade rating of Kaufman & Broad SA, the only European developer to have this rating. The group is thus in a position to take full advantage of the recovery in a healthy market.

 

 

 

 

For the whole of 2024, the group's revenue is expected to be around 1.1 billion euros, the difference compared to 2023 being explained by the base effect of the Austerlitz operation. The recurring operating income ratio is expected to be between 7% and 7.5%. The group is expected to remain in a positive net cash position (b) after taking into account the payment of a dividend of €48M for the 2023 financial year, or €2.40 per share, subject to the approval of the General Meeting of May 6”.

 

  • Sales Activity

 

  • Housing division

 

In 2023, housing orders in value amounted to €1,079.4 million euros (including VAT), compared to €1,433.8 million compared to the same period in 2022, down 24.7%. In volume terms, they stood at 5,332 homes in 2023, compared with 6,214 homes in 2022, a decrease of 14.2%.

 

The take up period for programmes was 4.8 months in 2023, an increase of 0.5 months compared with the same period in 2022 (4.3 months).

 

The commercial offering, with 97% of homes located in tight areas (A, ABIS and B1), amounted to 2,114 units at the end of 2023 (2,218 units at the end of 2022).

 

Customer Breakdown

 

In 2023, bookings in value (including VAT) of first time buyers accounted for 11% of sales, compared to 13% over the same period in 2022. First time buyers accounted for 4% of sales, compared with 9% in 2022.

Orders made to investors accounted for 13% of sales (of which 4% for Pinel’s scheme alone), compared with 33% in November 2022 (and of which 24% for Pinel’s scheme in 2022). At the end of November 2023, block sales accounted for 72% of orders in value (including VAT), compared with 45% over the same period in 2022.

 

  • Commercial Property

 

At 30 November 2023, the commercial division recorded net orders of €33.7 million (including VAT) compared to €47.9 million including VAT at the end of November 2022.

 

Kaufman & Broad currently has 92,000 sq.m. of office space and about 228,800 sq.m. of logistics space on the market or under study. In addition, 119,500 sq.m of office space is currently under construction or in start up in the coming months. Lastly, the company has nearly 13,500 sq.m. of office space to be built in MOD (delegated project management).

 

  • Leading indicators of business activity and growth

 

In 2023, the Housing backlog stood at €2,053.4 million (excl. VAT) compared to €2,362.8 million (excl. VAT) for the same period in 2022, i.e. 25.7 months of activity compared to 24.6 months of activity at the end of November 2022. At the end of November 2023, Kaufman & Broad had 131 housing programs under marketing, representing 2,114 housing units (142 programmes and 2,218 housing units at the end of 2022).

 

The housing land portfolio represents 34,069 units, stable compared to the end of November 2022 (34,009 units). At the end of November 2023, it corresponded to more than 6 years of commercial activity.

In addition, 88% of the housing land portfolio is located in tight areas, representing 29,995 housing units as of November 30, 2023.

 

In the first quarter of 2024, the Group plans to launch 12 new programs, of which 3 in the Paris region representing 278 units and 9 in the Regions representing 285 units.

 

As of November 30, 2023, the Backlog of the Commercial property division was 622.6 million excluding VAT, compared with 1030.5 million euros excluding VAT for the same period in 2022.

 

  • Financial result

 

  • Activity 

 

Total revenue amounted to €1,4,09.1 million (excluding VAT), compared to €1,314.9 million in the same period in 2022.

 

Housing division revenue amounted to €957.8 million (excluding VAT), compared to €1,152.5 million (excluding VAT) in 2022. It represents 68.0% of the group's total revenue.

 

Revenue from the Apartments business amounted to €883.0 million (excluding VAT) (vs. €1,076.3 million (excluding VAT) at the end of November 2022). Revenue for the Commercial property division was €437.5 million (excluding VAT), compared to €150.2 million (excluding VAT) over the same period in 2022.

Other activities generated revenues of €13.8 million (excluding VAT) (of which €7.4 million related to the operation of student residences) compared to 12.2 million euros in 2022 (of which €6.7 million related to the operation of student residences)

 

  • Profitability data 

 

At November 30, 2023, gross profit amounted to €257.2 million, compared with €228.2 million in the same period in 2022. The gross margin was 18.3% compared to 17.4% in 2022.

 

Recurring operating expenses amounted to €147.9 million (10.5% of sales), compared to €130.0 million in the same period in 2022 (9.9% of sales). Current operating income amounted to €109.3 million, compared to €98.2 million in 2022. Current operating margin stood at 7.8%, compared with 7.5% in 2022.

 

At the end of November 2023, consolidated net income amounted to €76.5 million, compared with the same period in 2022 when it amounted to €69.3 million. Non-controlling interests (Minority interest) amounted to €16.3 million at November 30, 2023, compared with €20.2 million in 2022.

Attributable net income was €60.2 million, compared with €49.0 million in 2022.

 

  • Financial structure and liquidity

 

The positive net cash position (excluding IFRS 16 debt and Neoresid put debt) at November 30, 2023 was €180.5 million, compared to a net financial debt of €(67.8) million at the end of November 2022. Cash and cash equivalents amounted to €350.0 million at November 30, 2023, compared with €101.0 million at November 30, 2022.

Financial capacity amounted to €600.0 million at November 30, 2023, compared with €351.0 million at the end of November 2022.

 

Working capital requirements amounted to €(80.8) million at November 30, 2023, or -5.7% of revenues, compared with €190.0 million at the end of November 2022 (or 14.5% of revenues).

 

  • Share buybacks

 

As part of its share buyback program, Kaufman & Broad entered into an acquisition agreement on September 5th, 2023 for a block of 1,251,000 shares of the Company held by Artimus Participations, a company bringing together managers and former managers of the Company, representing a total investment of €32.4 million.

 

Following the transaction, the repurchased shares were cancelled. This transaction allowed all of the Company's shareholders to be relaunched in the same proportions without compromising its investment capacity, while stabilising its shareholding. At November 30, 2023, group employees remained the Company's main shareholders, directly or indirectly, with 12.07% of the share capital and 14.43% of the voting rights.

 

  • Dividend

 

The Board of Directors of Kaufman & Broad SA will propose to the Shareholders' Meeting of May 6th,2024 the payment of a dividend of 2.40 € per share.

 

  • Outlook 2024

 

For 2024, the group's revenue is expected to be around €1.1 billion, the difference compared to 2023 being explained by the base effect of the Austerlitz operation. The Current operating margin (EBIT margin) ratio is expected to be between 7% and 7.5%. The Group is expected to remain in a positive net cash position(b) after taking into account the payment of a dividend of €48M for 2023, i.e., €2.40 per share, subject to approval by the Shareholders' Meeting of May 6th.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

This press release is available at www.coporate.kaufmanbroad.fr

 

 

 

 

 

(B) excluding IFRS 16 and Put Neoresid debt

 

 

  • Next periodic information date:
  • Tuesday, 9th April 2024: Publication of the 1st quarter 2024 results (after trading)

Presentation of results for the period

 

Mr. Nordine HACHEMI, Chairman and Chief Executive Officer and Mr. Bruno Coche, Chief Financial Officer, will comment on the results of the period and answer questions at a conference call in French with simultaneous translation into English.

 

The presentation of the results will take place in French with simultaneous translation into English on:

Thursday, 1 February 2024 8: 30 CET

 

Registration for the presentation of the results for the period must be made by request at:

Infos-invest@ketb.com

 

  • To follow the live presentation at the web conference you will receive a link (in French or English) *
  • To follow the live presentation at the conference by phone you will receive the number for the desired language (French or English)

* Activation of accesses from 8: 00, the connection requiring registration via a form

 

The Webcast media will be available ½ hour before the presentation starts at www.kaufmanbroad.fr/finance/publications-financieres/

 

Contacts

 

Chief Financial Officer

Bruno Coche -01 41 43 44 73/infos

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